>> i learned in the pursuit tournament, a "jeopardy " "tournament, this guy the on my team. >> did you get that? >> not really. last. >> why do you hate -- >> i'm sorry. >> time to talk. >> wrap it up. >> way too early what time is it? >> it's "morning joe." stick around for "the daily rundown" with chuck. crunchtime, one week until the debt limit deadline. speaker boehner and leader reid go their own ways. the white house rejects any sort of nine-month option. despite the drama, is a big deal still in the cards? and as thing keeps reeling, proof congress is broken beyond repair. some say this congress is the worst ever and he's seen lots and lots of bad ones. to the iowa straw poll break

the back of a campaign? sure looks like it. tim pawlenty and michele bachmann going toe to toe lashing out at each other. good morning. this is "the daily rundown," i'm which t chuck todd. house speaker john boehner and harry reid have separate plans in the works to raise the debt ceiling before next tuesday's deadline. house republicans are flat out dismissive of reid's plan for a $2.7 trillion cut since a trillion of the cuts are not really new but simply counting the saving from the wind down of the wars in iraq and afghanistan. senate republicans say reid was with them on a two-step increase process, but that the white house shot that down. and the white house says it's all up to boehner to find a way forward. now, pressure is mounting, so is anxiety over the markets. here's white house chief of staff bill daley on "meet the press" yesterday. >> we are now getting to a point

where i think markets around the world will question whether the political system in washington can come together and compromise for the greater good of the. >> country. >> the new fear. a downgrade in america's credit rating even if a debt creeling is raised. if only for six or nine months if it looks like washington can't figure out a long-term debt and deficit issue. by the way, something else going on here. the white house is basically out of the talks. harry reid is proxy for the white house. there isn't much communication going on between house republicans and the white house. it looked like yesterday morning that might not be the case. right now it appears it's the white house talking to reid and reid passing on the messages to boehner and to mcconnell. now, while boehner and reid appear to be talking past each other, the speaker and the white house still are arguing that somehow there could be this grand bargain. yesterday morning, here's what it sounded like. >> i don't know. it may be pretty hard to put

humpty dumpty back together again, but my last offer is still out there. i've never taken my last och oaf the table and they never agreed it it, to my knowledge. >> what tim geithner said on that same program. >> there's two types of plans on the table now. one is the framework that the president and the speaker of the house have been talking about for the last several weeks now. >> i thought that's dead? >> no. they're talking still, because, again, both the president and the speaker believe that the best thing we can do is put together a very substantial contribution to getting our fiscal house back in order? >> you're saying the grand bargain is still on -- >> i wouldn't say it that way. there's two approaches before us. >> is the grand bargain still alive? unlikely, at least not until the markets react dramatically and some deal doesn't pass both houses. what we know is going to happen today -- speaker boehner will announce

his own plan a two-step process, raising about a trillion, stoix nine months, creating a joint committee of a bipartisan committee, six democrats, six republicans who have to come up with about another $2 trillion in cuts to trigger this second debt ceiling increase. the boehner folks argue it's a similar two-step process they were working with the white house on except instead of the debt ceiling as the trig ter was going to be either bush tax cuts and the health care mandate. we shall see. meanwhile a world away seems like two people in minnesota at war over who's a better conservative. tim pawlenty and michele bachmann pb straw poll anxiety. isthe winner? and republicans say the only thing worse than the mess right now would be doing it all again in a few months. kelly o'donnell is nbc's

correspondent for us at capitol hill. kelly what i understand, the clock starts, which means we'll see vote on wednesday, and house republicans say, i understand they want to be able to do this without any democrats? >> reporter: well, you're making the assumption he's actually going to do it at 2:00. we're not getting absolutely clear signals of that. he said on sunday he'd be ready to act alone with republicans today, means sunday, and that didn't happen. so the target now is 2:00 when members return here to washington for them to be filled in on the plan and then for us to find out about the broader details, too. so that's assumption one. if that goes forward, it is still a problem with the clock, because they do have to post it. then there has to be the vote. then it would be to go to the senate. they'll about whole dance this week of all of the things we need to learn about procedure, but can you imagine if we have to do this again, in a matter of months? that's what democrats are

saying. their frustration is they believe the speaker's plan to do it in two pieces is just too problematic. now, republicans tell me the reason they want to do that is that there would be an initial savings and cuts that would be made, and they would want to raise the debt ceiling only to that level. they can't find enough cuts they're in agreement about just now, to carry past the election. as you've heard, the president and his team want to make sure this isn't and issue argued and fought about again prior to his name being back on the ballot, so they want to see it after the 2012 election. so how can they get there? harry reid says he can do something that would answer two of republicans' biggest concerns. having no new taxes in a plan and able to have the overall amount of cuts exceed what the debt ceiling increase would be, and so that's where harry reid is trying to go. there's a lot of frustration from republicans claiming reid and his team are coming out two publicly yesterday claiming this was their idea when they say

republicans had been talking with them all along. >> kelly, it's my understanding, the $2.7 figure counts savings on the wars. >> reporter: that's what wee hear i we're hearing. >> republicans count it at $2.7 or more than $1.5 trillion in koub counts for what the debt ceiling raises? >> reporter: more in the 1.5 camp saying that future savings on the war is something that's along too amorphous for them and they want to see, will things be real? part of the two-step process republicans describe is sort of an enforcement mechanism. have everybody agree on the first chunk. let's see how things go with this commission, yet another team of people who will decide what cuts should be, how would they go? would it be acceptable and then increase it again. so it's very different approaches. there is lots of agreement. we don't talk about that often, but there are things they do agree on. it's the details that matter, and that's where the sticking point has been and continues to

be quite elusive. >> that's for sure. a long week ahead. this is not going to get solved today. i think we know that. thanks, kelly. the big worry, reaction of foreign markets to reaction on a deal this weekend and how that could impact investors at home. a global look at markets before the opening bell. a lot of fear of reaction to the washington inaction. what can you tell me? >> you know, chuck, this morning it looks like markets will open down. right now the dow futures are down by about 110 below fair value. gold prices skyrocketing again, up by about $17 now. well above $1,600, but the real story here may be the reaction wasn't even more severe. we heard all of those warnings coming from tim geithner and others over the weekend if something wasn't resolved by sunday night we'd see a major sell-off in the asian markets and we'd see a major sell-off here on wall street and that does not seem to be the case.

there is a drop but not something that has many markets watchers that concerned. they basically think a deal will be struck, something that still comes through in the 11th hour and if you looked where things stood last night when the markets first opened on sunday night, we saw drops that were twice as steep as they are right now. things seem to be calming down. get through that rhetoric of the weekend, get through the sunday morning talk shows and the view on wall street from just about every person we talked to today was that there will be some sort of resolution, not pretty but they think it's coming and this will avert some sort of disaster. >> all right. thank you. they, wall street may be a lot more confident than folks in d.c. thanks very much. well, the main task was selling any debt ceiling increase to rank and file republicans. majority whip kevin mccarthy and he joins us next. can he whip up enough votes to put any parts of himpty dumpty back together again?

we'll ask. later, is congress broken beyond repair? we'll talk to a former senator, will it get worse before it gets better is that the boaest we ca hope for. ahead on the president's schedule. what's on the schedule. speak at annual conference of la raza. welcomes the world series champion san francisco giants. as a dodger fan, hard to realize. we're going see him on the debt talks. mark my words. you're watching "the daily rundown" on msnbc. [ male announcer ] know the feeling? get the contacts you've got to see to believe. acuvue® oasys brand contact lenses with hydraclear® plus technology, keeping your eyes exceptionally comfortable all day long. it feels like it disappeared on my eye. [ male announcer ] discover why it's the brand eye doctors trust most for comfort. if you have astigmatism, there's an acuvue® oasys lens for that too, realigning naturally with every blink. ask your doctor for acuvue® oasys brand.

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the president would veto a plan if it does not extend the debt ceiling into 2013? >> yes. the president believes we must

get this uncertainty in order to help the american economy and gust get this uncertainty out of the system. >> that was white house chief of staff bill daley who says the president is not interested in any what democrats call the short-term deal on the debt. senator harry reid says the idea is a non-starter in the senate. congressman kevin mccarthy is the house majority whip, which means his job is to round up the votes to pass any legislation in the house on any given day. and he, perhaps, has the toughest job in front of him. congressman mccarthy, welcome to "the daily rundown." >> thanks for having me. >> let me start with, first, the so-called grand bargain that's on the table. yesterday speaker boehner said on the fox news sunday that his final offer is still on the table, which included a targeted $800 billion in new revenues into the government with tax reform. is that your understanding?

>> well, he said he proposed that, the president never moved to it. the president wanted more revenues. what the speaker proposed is a whole tax reform where you actually lowered the taxes, took care of the amt and others and did not have a tax increase but you had productivity to get this economy moving again. the president only came back with wanting more revenues focusing on some type of tax increase knowing that we're not going to do that. the president even the majority with speaker pelosi did not raise taxes. they knew that was a non-starter. >> but the boehner plan did include some revenue increases from -- closed loopholes, less deductions, yes to overall tax rates which is what everybody described tax reform as, but there wouldn't have been this whatever loopholes closed, found other places? $800 billion in other revenue into the treasury. were you comfortable with signing off on that? >> well, what the speaker

proposed, though, when he says 800 you were lowering taxes. closing the loopholes, just like we did inside our budget. we closed these loopholes the president talks about out there. if you look at the framework of what he said, the tax rates would actually drop in the process. you would flatten it, shorten it and broaden it and have tax reform. we'd have investment into america, you would note have tax increases. >> let's taug about what's going to happen today. my understanding speaker boehner is going to introduce a two-step process to raise the debt ceiling. one that would be a six to nine month increase, a trillion cuts up front, the creation of a joint bicameral, bipartisan evenly split congressional commission to come up with another $1. 8 trillion deficit reduction to raise the debt creeling a second time. is the speaker going to introduce that plan today at 2:00? >> well, the speaker will have a conference at 2:00 to talk about what direction we're going in.

there's a couple different options. things keep changing every day. this is the difficulty. you've got to remember. here was the house that passed a bill, bipartisan vote, democrats joined with us, on the cut, cap and balance proposal, sent to the senate. the president has not laid out a plan. so i think what we're find inside conference is a different framework when we go in. use the same framework as cut, cap and balance but is there a way to produce something that can pass the senate and actually get to the president? you'll find a lot of different options on table and inside the conference we'll talk about which direction we want 20 go. >> and is it your understanding you're going to do this with, at this point, 217 republicans that you want to pass whatever the speaker introduces with only republican votes, if necessary? >> if you watched last week, we did it with more than that, with republicans and democrats, which is unusual. >> but this is not going to have the balanced budget amendment in it, from what i understand,

because that can't get through the senate. what this will have, this idea of setting up a commission, which is calling for basically two debt ceiling increases, which you had argued in the past was going to be very hard to get through this house. >> it is hard to get through the hout house, but also we laid out a framework. no new taxes, will not raise the debt limit more than we actually find cuts. ed problem here, not the idea you're going to look at what is your political option so i never want to vote on this again, but republicans are looking at, here's a structural problem we want to fix. we're looking to find a solution, not for a political option and unfortunately the president looks more politics, is putting politics before the people. we need to solve this structural problem because it's only going to get worse if you ignore it or put more budget gimmicks and accounting tricks to it. that's what you've found out there on the senate side. >> what if -- >> discount something to do with the balanced budget at the same time. do not discount -- s. that the only way you can get 218 house

republican votes? is that the issue? that you have to have some form of a balanced budget amendment as a part of this to get this out of the house? >> i think the issue is, we're looking to try to solve the problems. we think cuts currently, change the behavior. cap so it doesn't get out of control where you see discretionary spending going up 84%, then make sure that you're changing it long term. so if you have a balanced budget you've got some structural change long term as well. 16 years ago we came one vote shy of that, and had that -- >> but you didn't propose -- that is not the balanced budget amendment proposed by you guy. you guys proposed a balanced budget amendment, two-thirds super majority to ever increase revenue. >> the founding fathers said, as the house produces something the snoot can produce something, go to conference and work out your differences. this side of the aisle, only the house produces anything, from a budget to a cr. the senate hasn't produce add budget in more than 800 days. you're talking years. >> let's go back to what can

actually pass both chambers this two-step process. you're saying, is it going to include a balanced budget amendment or not? >> i think it will have some form. maybe a balanced budget amendment right now, maybe it has some vote in the near future, but i think a balanced budget is something that people look at, because it's part of, remember the structure -- >> a clean one? >> of cut, cap and balance. >> right. >> a clean one meaning without this super majority, but sort of one that the other states actually have? most of the other states? >> a lot of other states have one that have a protection for a tax increase. some states have it where they have a cap. these are all things that can be debated on, but i think the one thing that has to happen is you've got to have some structural debate that goes with cut, cap and balance. it's hard to negotiate with yourself. ever purchased a car on house, make an offer, no one brings anything back, jut tables it, hard to negotiate with yourself. we'll keep doing this and that's

a cut, cap and balance. >> against, that's not going to end up back. we've seen that that got rejected by the senate. what is going to get introduced? will it have the -- >> it did not get rejected. it got tabled, and so -- >> well -- >> there is a framework there that shows a bipartisan movement out of the house, and i think, also, when you look and sit back -- >> do you realistically -- call five democratic votes bipartisan? i mean, you know, this is where -- >> that's more of a bipartisan than the stimulus or health care bill so, yes, i would. >> at this point in time. going back, you're saying a balanced budget amendment might be in the first part of this plan and if the senate takes it out and sends it back, then maybe you can get this passed in the house? >> i think you want to look at the overall structure. we take the cut kcap and balanc, that framework, how can we get something through that solve as problem? we're more interested in solving the problem than just getting

something done politically and i think that's the framework that the american public are looking for. if the senate dislikes our bill, then tell us what they're for. they've been very difficult to try to get anything through on the senate side. so it's difficult to see what they're even for. >> all right. and is this -- is speaker boehner's last offer with the president still on the table? >> well, the speaker, he put it out the senate it was, but i don't think the president could ever go for something that actually creates jobs in the process. he's looking just for more revenues. he's trying to raise taxes and the other option he wants, looking just political so he can get this past the election. not our words, the president's words. the president needs to come off that and the start looking at problem and say how can i structurally change it and solve and get a solution. >> sounds like it on the table, not really. can't figure it out. reading between the lines is difficult. house whuben whip mccarthy, thanks for coming on. a new phase in the race for

2012 as home state rivals fight it out. michele bachmann and tim pawlenty. strong pollings for everybody, and live to norway. the man accused of killing more than 90 people just appeared in court. first, today's trivia question -- who are the last two democrats to win the white house without winning the state of new york? question courtesy of our new favorite twitter trivia buddy mr. jeff greenfield. the answer at chucktodd@dailyrundown, that's coming up on "the daily rundown." ♪ you know how i feel i'm loving weight watchers pointsplus program and the edge it's giving me. ♪ freedom is mine ♪ and i know how i feel i never feel deprived. you know how freeing that is? ♪ it's a new dawn, a new day i feel good. i feel good. i feel good. [ female announcer ] join right now and you can join for a dollar. hurry. offer ends august 6th. weight watchers pointsplus.

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it's norwegian man accused of killing 3 people appear before a judge but didn't get the public stage he was hoping for. proceedings in oslo, closed to the media. we have the latest for you. >> reporter: hey there. absolutely it was a closed

hearing. no one allowed inside. lasted about 45 minutes we understand now that the suspect is back in police custody at headquarters. that's one of the big stories unfolding here now. the judge is in fact speaking, though i'm told by local people here he won't say much. he won't disclose what went on in that hearing but is speaking now to explain why he closed the hearing. what we know, there were concerns about security and about hindering the ongoing investigation. that's the reason he allowed it to be a closed door meeting. as the story is developing, we're in front of the cathedral here in oslo and hundreds of people continue to pour into this area leaving flowers. emotions very high here. >> oslo, so tragic. the country that essentially hands -- to have some violence happen with their borders. coming up, could both the nfl and washington get their

deals cuts in the same 24-hour window? unlikely on the washington side. likely on the nfl side. is the 112th congress the most dysfunctional ever? this is the "daily rundown" only on msnbc. we'll tell you, after the break. ? oh, just booked a summer vaycay. ooo. sounds pricey? nah, with the hotels.com summer sale, you can find awesome deals for places nearby. interesting... wow, i'm blown away. you look great. hotels.com summer sale, save up to 30%. and get a free kindle. hotels.com. be smart. book smart. it flows with clean water. it makes its skyline greener and its population healthier. all to become the kind of city

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[ ting! ] [ male announcer ] travelers can help you protect the things you care about and save money with multi-policy discounts. are you getting the coverage you need and the discounts you deserve? for an agent or quote, call 800-my-coverage or visit travelers.com. the stories making headlines, democratic congressman david wu saying he's not seeking re-election following allegations of aggressive and unwanted sexual behavior way young woman. democratic leader nancy pelosi asked for an ethics probe, wu described earlier she being treated for mental health issues and apologized for other erratic behavior including e-mailing a photo of himself in a tiger costume. pressures to get him to resign, he may lose all committee assignments. and hoping they will drive him into resignation. somebody pointed out, wasn't easy for the democrats to figure how to push into retirement.

officials given the all-clear at jfk airport in new york city after reports of a suspicious package. bomb sniffing dog was activated when an unattended bag was found a lounge area. parts the american airlines terminal shut down as as precaution. only a small area of the terminal was actually evacuated. and the maid accusing dominique strauss-kahn of rape, in an interview, diallo insisted she being truthful despite prosecutors are questioning her account on proceeding in the alleged charges. and the nfl association finally reached agreement with the league's owners according to nfl.com. ate co according to reports, they will vote on a ten-year agreement. training camp could start this unofficially this afternoon if signed. which means we can all plan or fantasy drafts. all right. moving on. the partisanship in washington

reach add feevered pitch with leaders spending the weekend getting together and then breaking up over potential debt deals gone bad. was congress always this dysfunctional with gridlock or is this the worst congress in history? and with us, our guests, all right. welcome. you started this. you had the big headline. gigantic headline that said, first time ever, worst congress ever, first time, the 111th congress ever. the rating showed the most conservative democratic senator was to the left of the most liberal republican. there is now no overlap ideologically at all between the parties making this a dysfunctional congress. >> we always have boy boisterousness, but in the belly of the beast i haven't seen it this bad.

we just don't have a center anymore. fundamentally, chuck what we have is parliamentary pard innocen partens. you have a minority republican party with the reins of power through the house. voting no on everything the president wants or does, leads to the embarrassment we're seeing now. >> and senator, were you from a conservative, ideologically, moderate to conservative center right stake being a democrat. almost forced politically to always be the person in the middle. that's not the case in the house. >> i think norm's right, check, in the sense there's no more large, healthy center in the two parties right now where you have to have a deal that starts in the center and then works out to the left and to the right until you create a majority. you start from the far left, or the far right, seemingly what's happening now. you nerve ker get a majority.

a lot of reasons why it's like that now. they don't talk to each other as much as they used to. have separate lunch caucuses every tuesday. whether a battle plan against the other side. they don't hang around. don't pal around tuesday through thursday in the house. they don't get to know each other. that prevents people from working together if you don't know people in the other party at all. >> a diagnosis from a former republican senator on "meet the press" yesterday. >> you're supposed to come to washington to help govern, find solutions, solve problems. we're not seeing that. this didn't start by the way with this president. i saw this in the senate emerging over the last 12 years. both parties are to blame. we have, i think, a vacuum of leadership and courage. courage has never been abundant commodity in washington. >> he brought up a point, my pet peeve on this. we always say the good old days. in those times, there is a great lisa myers piece that has all of the retiring senators from 1996,

alan simpson is one of them in there talking about how, oh, the partisanship of this new washington, this is washington circa 1996, which is too much to take and can't believe it. >> you know, it's certainly the chase we had knocked down, drag out fights all along. frankly, a lot of the problems started around the 1994 elections. newt gingrich used an approach that worked. took him 16 years to get there, that was, we have to destroy this institution to save it, to bring in a majority. we've had close partisan margins since pt the permanent campaign takes over. so all of those problems back then have been exacerbated until now. but you can go back then and we found solutions to the immigration problem, with ron masoli, a democrat joining. plenty of partisanship. simpson himself said, said i would never come back now. we used to sit down and say, what can we do to help the country jt now it's what can we do to screw the other guys?

>> a lot of chatter about a third way, third parties independent run. all of it folks, i think, too much on the presidency and not enough on congress. if there were viable, independent candidates for the u.s. senate and for the iz house do you think that could change the institution? or polarize it more? >> always said the independent doesn't have much of a chance. i'm reconsidering because it's gotten so bad, people said, look, i'm not part of either one ever these groups of people up there. i'm an independent. i'm doing what's best for the country. the heck with the parties. the becoming more of a possibility, even at congressional races and in senatorial race, but i mean they used to shoot each other in the old days. >> right. >> get in fistfights on the floor. ultimately, able to get together and pass something that would work. like i said before, gridlock replaced the word compromise. they don't believe in it anymore. two football teams, you've got to destroy the other side to win. nothing wrong doing something that both sides claim victory.

>> and not penalized, both parties yet. is that fair? >> right now -- >> penalized the two party political system? >> difficult to figure out how to do that. independents running for the house and senate might divide that. i'm not at all sure. what voters haven't done, focus on which party is morphing. a lot of blame sharing going on. the california experiment in opening up primaries so you no long verify a sliver of voters dominating this process. a majority of republicans say solve this problem with revenues and with cuts. republicans in congress aren't responding to that group to that tea party group. >> still got the most conservative republican you can find slip into that first time that they tried this in california. >> yeah. it's not necessarily going to work. my favorite would be to adopt a version of the australian system of manned attorney attendance at the polls. both party's bases turning out all the time and then you have to focus. >> mandatory attendance at the

polls. >> chances of that, zero. >> no. $15 if you don't fine. they get 97% turnouts so people don't pay the fine. >> there you go. norm, john, i want to do this conversation more. thank you both for coming in. >> thank you. kicking af another week of posturing in politic on the debt deal and the powerhouse panel here to break it all down. plus, let the games begin. less than 20 games to go to the straw poll that's heating up in the headacheeye state. the soup of the day. lentil. i don't have nouch say. i like a good lentil soup. most of my colleagues hate it. are good when the put the meat in. when you don't, then it's bad. you're watching "daily rundown" only on msnbc. [ dave ] ...you take any surface

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daily flashback, on this day the world's first so-called test tube baby was born weighing in at 5 pounds 10 ounces, the first

baby conceived outside the womb. scientist edwards eventually received the nobel prize pioneering the science of in vitro fertilization and bringing the joy of children to many millions of folks around the world. all right. it's going to be a long week of back and forth with the clock ticking louder on the way to the august 2nd death deadline. who in anyone we'll blame first and where is the line between thrill theater and renegotiation? with us on the panel today, dan ball, and the chief for "the washington post." politico senior political reporter jonathan martin and from the center for american progress and former secretary for form e president bill clinton. dan ball, start with you. the chief. i want to get to sort of, you know, sometime wes know there's rhetoric for public consumption and stuff going on behind the scenes. trying to read behind the lines yesterday on speaker boehner on fox. here's what he said.

>> last sunday i thought there was an agreement of $800 billion in new revenue. in the afternoon when the president call immediate and demanded $400 billion in more revenue, there was no way you can get that out of tax reform other than raising taxes on the american people. it was time for me to step back and to begin to figure out what was that for. >> interesting about what he said. kevin mccorning ccarthy wouldn' that it was what it was. some the of chatter. not clear cantor and boehner were completely on the same page. he signed off on that. do you get the sense that deal -- >> i have no idea -- seriously, i don't -- that may be the only way you get to a quote/unquote grand bargain, but there's no evidence house republicans as a group were really prepared to sign off on that, nor is there any evidence that what boehner

and cantor were asking the white house for in return, the white house would ever have fully agreed to. so, you know in a sense, all of that may still be on the table, but, you know, the devil's in the details. the old cliche, and with so many details we don't know about from those negotiations. we're flying blind at this point. >> john and martin, listening to john mccarthy earlier, he was saying, sort of hinting they need, the balanced budget amendment will be part of whatever they get through this boehner plan telling me they don't have 218 votes without something else with it. >> right. >> and they clearly want to do this without any democratic votes. >> right. there has to be a swinger still. talking to house folks ober it's weekend and i don't think there are the votes there for anything that is like the mcconnell plan at all. on this sort of new two-step plan boehner is talking about, there is some question whether or not there will be a guarantee that the president would get the authority for that second amount of money.

that's one of the key stepping points here if that does become the plan, whether or not the president should have that authority automatically for the second half of the money. >> only if it comes in. react politically to what speaker boehner, the other allegation he made yesterday about politics involved in this. here's what he said. >> after over six months conversations with the president, about doing the big deal, about taking a big step in the right direction, it's pretty clear to me that they're just not willing to do it. that the next election matters more than doing what's right for the country. >> all right. i think we make it clear that everybody is worries about the next election. you can see it in all the conversations, but how important? the president does not want to deal with this in nine months. be clear. he is speaking some truth as far as politics. >> two things. i actually think, maybe three things. what may be weighing the most on them, there's not a lot they can do to really help the economy now, but the one thing they can do, give it certainty.

i think that the specter of doing the debt increase again in 2012 actually scares them more than the politics. because the politics of it aren't really breaking the republicans way, and the next time, go back in six months, it's going to be hard for the republican candidates to stay out of it. and when, the last time presidential candidates got involve fld 2008 in an economic crisis it didn't work out great for the republicans. i don't think that -- but it's hard with them for the public, because the public if they tell the public we're going to veto this because we want to get through the election that's going to look political. >> the white house right now is not involved in the conversation. right? harry reid is the proxy. goes back and forth now. that sort of -- how does the president deal himself back in? >> well, the president may not look like he's in the middle of this, but you have to believe that the white house staff is -- >> no doubt working with reid, but no conversation apparently with some of the republicans? >> no, but they have to let the republicans play out this string.

i mean, the republicans, the speaker decided we're going to try to go it alone. i mean, he's either going to succeed or fail on that and have to come back and work with the democrats, but i think they decided for now, let him go do what he thinks he wants to do. >> and frustration, tent up everywhere. chuck schumer on "morning joe" showing his cards a little bit and venting. listen to what he had to say. >> here's what drives me crazy about this debate. we have moved and moved and moved away from what should be our position. we don't like credit, so to speak. we don't like entitlement reform. we've moved from that. the republicans have stayed on dime without going for a single nickel of revenues and you can't do a large deal without revenues no matter you do in entitlement reform unless you end the entit entitlements. >> the facts speak for themselves. now the president is for cuts too. republicans won the fight and haven't declared victory. >> it's a great scene there from

a very canny political strategist who's seen his party give up a lot. >> in his mind too much. >> exactly. that's clearly the telegraph and haven't gotten much in return. also, a politician generally worried about your state, too. which could take a huge hit here. >> bigger than the middle states? >> at least a couple. hang on. we're going it talk about 2012 in many ways. just a nice, positive, interruption to this debt ceiling debacle. trivia time we asked, who were the last two democrats to win the white house without winning new york state? the answer, did you know? >> truman? >> yes. truman is one. >> but i think it's way back beyond that. >> no. woodrow wilson. they both ran against new yorkers. dewey guess trouman and thanks o greenfield for that one. you're watching "the daily rundown" only on msnbc. whoa. right? get out.

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a little bit of 2012 distraction. well, here we go. tim pawlenty versus michelle bachmann. i was just going to say one man's distraction is the entire presidential campaign on the line for tim pawlenty. let's look at how this started. tim pawlenty and michelle bachmann on "meet the press" in july earlier this month. >> i like congresswoman bachmann. have i campaigned for her. i respect her, but her record of accomplishment in congress is nonexistent. it's nonexistent. we're not looking for folks who, you know, just have speech capabilities. we're looking for folks that can lead a large enterprise in a public setting and drive it to conclusion. i've done that. she hasn't. snoo that was the first time, jonathan martin, that tim paulent where i went after bachmann. she didn't respond, and then yesterday it back a back and forth via press releases. michelle bachmann said executive experience is not an asset if it simply means bigger and more intrucive government. when i was fighting against the unconstitutional individual

mandate on health care, governor pawlenty was praising it. i have fought against irresponsible spending while governor pawlenty was leading a million dollar budget mess in minnesota. i fought cap and trade. governor pallenty backed cap and trade when he was governor of minnesota. why fight back now? >> everything that is happening 234 iowa can be the still down to the contract from her experience two weeks ago of he first launched the attack. two weeks ago she said nothing at all. yesterday she dropped her whole file on his head. >> just dropped it. >> her organization is not where his is. he has been out there a lot longer. she's playing catch-up. i think going into ames, he is showing some progress, and i think she's trying to insure that she can still pull that out, and in doing so you're trying to create doubts in the minds of conservatives out there about his record. >> think like a campaign strategist. that's what it felt like to me. why do you do this now? wow, tim paul ebty, even though the rest of the political world

is trying to write him off, something is going on. >> right. i think that, yeah, i think she's feeling that he is catching up to her, and it just feels so predictable to me. the idea that people were writing tim pawlenty off -- i know you were not. he was on the show before. it's like jeff bellami writes this story, and is he going to be the first to drop out. he then says i'm being too managed. i'm going to be myself. >> bachmann as the frontrunner in iowa, if she doesn't win the straw poll, everybody will say a mile wild and an inch deep. pawlenty needs something to jump-start his campaign. >> let's step back, a half a step. rick perry is sitting down there in texas about to get in this race, everybody thinks. now, you know, he hasn't said yes, and no candidate is in until they say yes, but, you know, the shape of this race is going to change whether he gets in or not, so that's another big factor. put the straw poll aside.

>> fair enough. i have to go to shameless plugs. >> in texas new book out by a former colleague of mine about washington wheeler dealer texas native bob strauss called the whole damn deal. it's coming up public affairs this fall. it's a pretty good read. >> all right. >> the next time a one party controls the white house in both houses of congress, they need to change the rules so that when you spend the money, you raise the debt limit at the same time. >> that's an interesting idea. >> general cover story by scott glen, ron brownstein about the red and blue states and the different directions they're going in in legislation. >> it's a good one you should read. a lot of good august reading on the deck, and a good suggestion. thank you all. that's it for this edition of the daily rundown. tomorrow on the show, senator john thune, and we're busting out the battleground maps with charlie and stu. coming up next on msnbc, chris januarysing and company, and then at 1:00 don't miss andrea mitchell reports.

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